CEA Arvind Subramanian wants coal as major fuel, says India should not get distracted by carbon imperialism

CEA Arvind Subramanian wants coal as major fuel, says India should not get distracted by carbon imperialism

Chief economic adviser Arvind Subramanian said on Thursday that while India ramps up its renewables capacity addition programme, the country should still have coal as a major fuel and avoid getting distracted by the global debate on “carbon imperialism”.

The Economic Survey noted last week that the transition to increasing role of renewables in the energy mix is likely to adversely affect conventional energy generation assets. (PTI)

Chief economic adviser Arvind Subramanian said on Thursday that while India ramps up its renewables capacity addition programme, the country should still have coal as a major fuel and avoid getting distracted by the global debate on “carbon imperialism”. While delivering a lecture on ‘Renewables versus Fossil Fuels: An Indian Reassessment of Electricity Generation’ in New Delhi, organised by the Energy and Resources Institute, Subramanian pointed out that discussions on the perverse impact of renewable energy have already started in Europe. He cautioned that renewable energy comes with hidden costs and should not be overlooked in headlong submission to it.

The Economic Survey noted last week that the transition to increasing role of renewables in the energy mix is likely to adversely affect conventional energy generation assets. With renewables addition, a part of such plants would be left idle or running at low utilisation levels, the survey said.

Acknowledging that stranding of power generation assets can have implications for the banking system, the survey noted that the social cost of renewables was around three times that of coal at Rs 11 per unit in FY17.

Subramanian suggested ramping up coal production dramatically in the short run and slowing down renewable energy capacity addition. He said that coal can be slowed down and renewable energy ramped up, when social cost for the latter would change in its favour.

Coal would remain at the centre stage in India with its share in the energy mix not declining below 46% in 2047, claimed a recent report titled ‘Energizing India’, jointly prepared by the Niti Aayog and The Institute of Energy Economics, Japan.

The country intends to generate at least 40% of its electricity from non-fossil sources by 2030. To that end, it aims to add 175 GW of renewable energy-based installed capacity by 2022. Total installed capacity in the country currently stands at about 350 GW. In FY17, coal power plants generated more than 85% of the total electricity produced in the country.